Chinese firms might be giants at home, but they're dwarves overseas.

While a few Chinese companies such as Haier, Giant, and Li-Ning have established themselves firmly in international markets, their advancement has not reached anything like the global status enjoyed by their closest international competitors.

Chinese firms prefer taking over foreign companies in order to benefit from their brand name, such as Lenovo's acquistion of IBM and Geely's takeover of Volvo. Is this the path to global recognition?

The trend of Chinese companies acquiring foreign brands started in 2002 with TCL's taking over Germany's Schneider Elcetronics.

The most recent example was Geely's acquisition of Volvo last year. In between TCL's purchase in 2002 and Geely's in 2010, the numbers have increased in financial value and industry diversity.

In computing, Lenovo bought IBM's PC business for $1.75 billion in 2004, while in the auto industry Nanjing Automotive purchased MG's sportscar brand for $79 million. But it's oil that's seen the biggest takeovers by far, including Sinopec's massive $7.56 billion acquisition of Geneva-based Addax Petroleum in 2009.

Takeover activity involving Chinese firms as well as other representatives of the BRIC (Brazil, Russia, India, China) nations contiue to surge. They grew by 74 percent last year, with $402 billion worth of takeovers accounting for a record 22 percent of the $2.23 trillion of global deals, according to data compiled by Bloomberg.

Furthermore, deal-making between BRIC nations and Western competitors will increase as countries such as China and India seek to secure natural resources to support their burgeoning economies

Yet despite the growing takeover trend, the fact remains that six out of every 10 takeovers fail to achieve expected gains. Why? First of all, many acquiring companies fail to accurately estimate how much their target is worth.